Marijuana stocks rallied on Tuesday, with both Canadian and U.S. names up in morning trade. Aphria (APHA) and Curaleaf (CURLF) hit buy zones. 

The move higher for the sector — along with the broader market — comes a day after the General Services Administration said it would make resources and services available to help President-elect Joe Biden begin his transition to the White House. That process had been delayed while President Donald Trump contested the election results. 

Trump said he would continue to challenge the results. But he recommended the GSA to "do what needs to be done with regard to initial protocols," and said he had "told my team to do the same."

Investors have generally seen Biden, a Democrat, as being more favorable to federal cannabis reform. Marijuana stocks surged leading up to and after the election, which saw more states legalize it too. But some analysts have tried to temper expectations.

Among the big Canadian marijuana stocks, Aphria rose 7.7% to close at 6.85, clearing a cup base with a 6.25 entry. Rival Cronos Group (CRON) jumped 9.3% to 8.02, moving closer to clearing a consolidation with an 8.23 entry.

Canopy Growth (CGC) surged 9.1%. Canopy stock is extended from a consolidation. Aurora Cannabis (ACB) spiked 28.55%.

Tilray (TLRY) vaulted 17.2%. TLRY stock is bouncing above a test of its 50-day line, another potential buy signal, according to MarketSmith chart analysis.

In an effort to offload debt, Tilray, over Monday and Tuesday, said it had entered into agreements with debt holders to exchange nearly $200 million in convertible debt for stock — at steep discounts.

Within the U.S., marijuana stocks like Curaleaf (CURLF), which trades over the counter, rose 6.3% to 10.31, topping a 9.80 buy point from a cup base.

Innovative Industrial Properties (IIPR), a cannabis real estate investment trust, added 0.5%. IIPR was Monday's Stock of the Day.

Terrascend (OTC: TRSSF) rallied 4%. Cresco Labs (OTC: CRLBF) rose 4.1%. Acreage Holdings (OTC: ACRHF) gained 5.5%.

Marijuana Stocks And The Election

Even as the Biden transition begins, Trump has not yet conceded the presidential election. If Republicans hold onto Senate control, the prospect of federal pot legalization — and smaller measures that might give the marijuana industry banking access and states more leeway on their own cannabis laws — becomes less likely.

Marijuana stocks in both the U.S. and Canada have had to deal with debt, write-downs, layoffs, overexpansion and cash issues.

New Jersey, Arizona, Montana and South Dakota approved ballot measures to legalize recreational cannabis on Election Day. South Dakotans backed creating a medical marijuana program for people with severe medical conditions.

Those states give U.S. operators more room to expand, even if they have to reconstruct their supply chains in each new state where they set up shop. Some of those companies have said legalization in states like New Jersey could pressure other states in the Northeast to legalize as well.

No 'Mechanism' For Canadian Invasion

However, Cowen analyst Vivien Azer, who covers marijuana stocks, has said that there is "no near-term U.S. catalyst" for Canadian pot producers to enter the U.S.

Azer said that even if the Senate moved into the hands of the Democrats, the most they would likely be able to accomplish was a modified version of the STATES Act. The STATES Act, introduced in 2018 by Sens. Cory Gardner and Elizabeth Warren, would keep the federal government from interfering with states' pot laws.

"Absent that, we do not see a mechanism for a Canadian operator to enter the U.S.," she said.

Cowen analyst Jaret Seiberg has also downplayed the potential the STATES Act has on marijuana stocks.

"Given states would regulate cannabis sales with no federal government involvement, there would be no interstate commerce for cannabis (unless states were to enter compacts with each other to permit cannabis to move between them)."

Piper Sandler analyst Michael Lavery has said that even if Canadian producers could directly enter the U.S., they would "still need to secure licenses to operate in each state and build infrastructure to supply and distribute products, which likely takes time and capital."